Multi Commodity Exchange (MCX), largest commodity derivatives exchange for metals and energy including precious metals, has also applied for the launch of futures trading in diamonds with the Securities and Exchange Board of India (Sebi).

On Monday, Indian Commodity Exchange (ICEX) became the world's first exchange to start trading of diamond futures contracts in the world.

MCX has two options for settlement price. If Sebi permits, according to sources, it will use prices settled on the Singapore Diamond Investment Exchange (SDiX), the world's first and only commodity exchange trading in physically settled diamonds. Or, it will do polling like ICEX.

MCX had signed a memorandum of understanding (MoU) with SDIX for establishing areas of cooperation between the two exchanges.

MCX is optimistic on the success of diamond futures trading if permitted, as gold is the most vibrant commodity for trading on the exchange and therefore, the majority of traders dealing in gold also deal or understand diamond derivatives trading.